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A firm operates in a perfectly competitive industry. Suppose it has a total cost function of...

A firm operates in a perfectly competitive industry. Suppose it has a total cost function of C = 25 + 0.25Q2.

a) If the market price is $15, what is the firm’s profit-maximizing level of output?

b) If the fixed costs increase from $25 to $75, what is the firm’s profit maximizing level of output?

c) If the market price increases to $22, what is the firm’s profit maximizing level of output (with fixed costs at $75)?

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